(The Associated Press circulated the following story by Dan Caterinicchia on September 13.)
WASHINGTON, D.C. — Five rail companies overcharged customers by more than $6.5 billion under the guise of fuel surcharges, according to a study commissioned by businesses that accuse railroads of anti-competitive behavior.
The study, which covers 2005 through the first quarter of 2007 and was released Thursday, was based on regulatory filings and other estimates for Kansas City Southern, Union Pacific Corp., Burlington Northern Santa Fe Corp., Norfolk Southern Corp. and CSX Corp.
“This is the greatest train robbery of the 21st century,” said Jack Gerard, president and chief executive of the American Chemistry Council, which represents about 90 percent of the nation’s chemical makers. The amount was more than double what some railroad customer groups had expected.
Federal regulators in January banned excessive fuel surcharges and imposed strict rules on the fees that many rail companies have openly credited with bolstering their earnings.
The Surface Transportation Board ruling said the railroads must link the surcharges directly with the actual fuel costs for specific rail shipments and prohibited “double-dipping,” which means fuel costs can’t be calculated into certain price increases if the shipments already have other fuel surcharges.
But the board has no authority to enforce refunds or seek penalties, Gerard said, adding that railroad customers lack any regulatory means to attempt to recoup the money. Still, some have filed lawsuits alleging the fuel surcharges amounted to price-fixing.
Robin Chapman, a spokesman for Norfolk Southern, declined to comment on the study but said that the antitrust lawsuits were “without merit” and that the company plans to contest them.
A spokesman for Kansas City Southern could not be reached for comment.
Tom White, a spokesman for the Association of American Railroads, said the lawsuits prove the industry’s rates already are subject to antitrust laws, though he acknowledged the industry has been exempt from some laws since it was deregulated in 1980.